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Word of the Week
June 19, 2000††††††††††††††††††††††† ††††††††††† †††††††††††

Fragments

Often investors consider a "fragmented" market as a good market to provide new services too. "A fragmented market" describes a market where most of the companies or people in that market are acting individually. This usually defines a good opportunity to pull that market together under a unified service (preferably yours). This makes sense at first thought because through a single type of software or service you can pull together a large portion of the market so that it is not fragmented any more.

Well, here we have the construction industry. Is there an industry more fragmented? Probably not. Over 80% of companies are small, localized companies with fewer than 20 employees. Most of these companies are sole proprietorships built by individuals who love the businesses and enjoy the satisfaction of being their own boss.

I disagree with the other 150 plus companies in the e-construction space that we will be able to eliminate fragmentation. Our industry is that way for good reason. The majority of companies get started with one or two tradesman who cut out on their own. Usually there is no long term plan or special program that someone goes though to be a contractor. Thus each individual company is unique with unique needs and ultimately different sets of solutions to the same problems.

We as Internet companies focused on the construction industry should direct our services at inter-operability. Not, "My way or the highway". We need to make the industry embrace our services, not give them a reason not to use them. I accept fragmentation and believe it is a healthy part of our industry. It offers unlimited choices of personalities, methods and approaches to fit the needs of different clients and projects.

Ultimately the construction industry could benefit greatly form a unified standard approach to project management. If, for instance, every contractor, architect and supplier used the same system we would be able to integrate and share information easily, saving loads of time. Come to think of it, there are probably a lot of fragmented industries that could benefit from a unified approach. I bet the ice cream industry could save loads of money if all they had to make was Vanilla.

 

James Harnett
CEO BuildersPlanet.com
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Archives

May 29, 2000    The First Of Many

June 6, 2000    Internet Speed

June 12, 2000    What's in it for me?

June 19, 2000    Fragmented

June 26, 2000    Wireless World

 

 

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